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HVAC Gears Up for the Battle of the Wall

Part of what makes the HVAC industry relatively stable is the fact that technicians and installers cannot be outsourced. They also have specialized knowledge, training, experience, and skills that take time and practice to acquire.

Yet lately, more and more homeowners are opting to purchase their own thermostats, whether online or at a hardware store, and install them on their own. Additionally, non-HVAC service providers, such as cable and security companies, are jumping into the thermostat market, too, despite often not having experience with HVAC equipment.

These scenarios can not only cause problems with the thermostat and the equipment to which they are connected, they often take sales opportunities away from the contractor.

Or do they?

BE THE EXPERTS

HVAC contractors are currently locked in a “battle for the wall,” and their opponents are the big-box stores, do-it-yourselfers, security companies, and cable providers that have realized the thermostat is the hub of the connected home and want a piece of the home-automation pie, said Dave Knight, co-owner and director of sales and marketing for Thornton & Grooms in Farmington Hills, Michigan. While HVAC contractors are no longer the only people capable of physically putting smart thermostats on the wall and connecting them to the Internet of Things (IoT), they are still the most qualified, by far, and that’s where the message is getting lost lately, Knight said.

“We, as contractors, haven’t done a good job recognizing this opportunity, and we need to step up our game and just embrace it,” he said. “Our customers still need us.”

Derek Cole, general manager of One Hour Heating & Air Conditioning in Laurinburg, North Carolina, agreed that contractors have not done a good enough job educating customers on the benefits of having experienced technicians help select and install thermostats.

“They’re not considering the value a professional brings to the job,” he said. “For Joe Smith to think he can just put in a thermostat and assume his contractor’s technical expertise has no value to him means we’re doing a bad job of telling Joe what we bring to the table for him. If he thinks he can go out and do the same thing I do, obviously I’ve failed at communicating why I’m in business and the market leader.”

One important thing contractors can communicate and market to potential customers is the warranty advantage of having a contractor install the equipment. Often, warranties are expanded when certified technicians install the equipment; sometimes, they are voided entirely if a homeowner installs the equipment.

“White-Rodgers has its basic thermostat, and they give a 10-year warranty on that,” Cole said. “That’s one way we can combat the five-year parts-only warranty with no labor. Yeah, you might save $100, but is it worth it?”

Contractors also need to communicate how important it is to match the thermostat to the equipment in order to ensure optimal operation, Knight said.

“The thermostats that are found in big-box stores don’t communicate, and with the higher-end products that are communicating products, you don’t get nearly the benefits that come with them without the right thermostats,” he said. “Customers may have a more sophisticated system — for instance, their furnaces and air conditioners may be staged or are communicating or zoned systems, or perhaps it is a heat pump system — and it takes a skilled and trained technician to figure out what product works best in those applications and how to appropriately install those products for the application. That’s where homeowners typically get lost, and then they’re not getting the full benefits out of their systems.”

The key, Knight added, is for contractors to act like the experts they truly are.

“I hate to say it, but it’s a tough battle,” he said. “We must exude the confidence that we can take care of them, even though they may have purchased their thermostats at big-box stores. We can still take care of them — and we want to.”

Steve Moon, owner of Moon Air Inc. in Elkton, Maryland, said regular maintenance also offers opportunities for contractors to not only assert themselves as experts in home comfort, but also to educate homeowners on the numerous benefits of having a professional take care of their home comfort needs.

“You don’t make money off a tuneup, but you’re trying to win the customer for life. Be sure to talk to them to see what needs they have,” he said. “We have the technology today to serve them and connect them with the best solutions for their concerns. We’re HVAC matchmakers.”

HANDLE WITH CARE

For contractors who are called into a home to fix a thermostat installation gone wrong, the No. 1 thing to keep in mind is that the homeowner is likely already very frustrated — and he or she may be nursing a badly bruised ego, too.

“These smart thermostats can be difficult to install. I’d estimate 50 percent of the people who buy them get in trouble and have to call us for help,” Moon said. He joked that the other half are probably just too stubborn to admit they need help.

“Guys don’t like to ask for directions, so they’re sure as hell not going to want to admit to their wives that they screwed up their thermostats,” he said.

Knight said technicians have to have both technical training and the ability to sympathize with a customer who installed it incorrectly.

“You can’t just say, ‘Who installed this and what the heck was he thinking?’” he joked. “You have to give customers confidence because they’ve already lost some confidence if their installation went badly. They’re already frustrated and maybe embarrassed, and if we can exude confidence that we know what we’re doing and want to help them and gain a customer, then what’s the difference, other than we maybe lost the thermostat sale? We still gained a customer and an opportunity because of their interest in their home comfort.”

Cole said responding promptly to customers’ concerns, whether they’ve made it clear they want your help or not, also opens doors through which contractors can enter customers’ homes — both figuratively and literally.

“First, you have to break through the noise and talk to them on social media. Talk to them, educate them, and stop trying to push your message out,” he said. “I’m interacting a lot more on Facebook and Twitter when someone has a question, and when a contractor responds to a question quickly, that means something to the customer. People come up to me all the time and ask questions without me trying to make a sale.”

Cole noted it takes time to establish oneself as a reliable source of information in the community, but the returns are definitely worth the investment.

“It’s kind of a soft approach, positioning yourself as the expert, but they’ll start coming to you,” he said. “We’ve been doing social media for a year, and this summer we saw great returns, but that’s how long it took. It wasn’t instant. It takes time to build that trust on social media.”

KEEP YOUR HEAD UP

In addition to marketing one’s expertise to the appropriate audiences, contractors agree that staying alert and on top of the latest thermostat and equipment technologies is absolutely necessary these days.

“You have to stay up to date and be educated. You can’t bury your head in the sand,” Knight said. “You have to be different. It’s not the same as it was. You have to know it’s the technology that’s driving the thermostat market, and people are buying into it. Obviously, people are buying them.”

“You need to give homeowners more information,” Cole said. “We get into a commodity game, and that’s what thermostats are to these big-box stores. Obviously, they’re going to win that game because they’re cheaper there. So, you have to take commodity out of it and go to customers, who have invited you into their homes, and make the case for your company never leaving their homes.”

“We look at it as taking an interest in their comfort,” Knight said. “We have to continue to market our services and be better than Home Depot and Lowe’s when it comes to taking care of and servicing customers. I think there are some companies out there that get mad at customers for going somewhere else, but our approach is that if you call, we’ll welcome it. They need us. Getting mad and taking your ball and going home isn’t the right approach.”

Denying that the market is changing drastically and not taking appropriate action can be a fatal move, Moon said.

“The guy who sticks his head in the sand is exposing the wrong part of his body,” he said. “Will the contractor ever go away? No, absolutely not, but with baby boomers getting older and millennials taking over, you’d better position yourself accordingly. It’s coming, like it or not — and we’ve been not liking it for about 10 years. It’s time to play the game.”